Signaling by many families of growth factors is regulated through the action of "co-receptors", plasma membrane molecules that do not directly transduce signals, but that influence the binding of growth factors to their receptors, or thee nature of the signals that such binding produces. For some growth factors (FGFs, Wnts, some EGF-related molecules) an essential co-receptor function is provided by cell surface heparan sulfate (HS), the glycosaminoglycan component of certain cell surface proteoglycans. For others (TGF-beta's, many cytokines), specific cell- surface growth factor-binding proteins play an important role. Recently, we obtained evidence that a cell-surface glycosylphosphatidyulinositol (GPI)-anchored protein plays a critical role in the binding of bone morphogenetic proteins (BMPs) to their signaling receptors in certain cell lines. BMPs play diverse and important roles during embryonic development, and the precise regulation of BMP activation is essential for normal development. The first aim of this project is to identify this GPI-anchored co-receptor, and establish its mechanism of action. For example, it will be determined whether this molecule interacts directly with BMPs or with their receptor subunits, whether its effects are kinetic or at the level of binding equilibria, and whether GPI-anchorage is an important property for its function. The second aim of the project is to investigate the role of HS in BMP binding and signaling. BMPs are known to bind HS, and genetic experiments in Drosophila suggest a role for an HS proteoglycan in regulating BMP signaling. This issue will be pursued using HS-deficient cell lines, HS-binding deficient BMP variants, and a variety of assays intended to reveal co-receptor effects of different types. These studies will also analyze the potential roles of BMP-HS interactions in the control of BMP diffusion, and the interaction of BMPs with known BMP inhibitors. After characterizing co-receptor effects on BMP actions in simple systems based on cell lines, the third aim of the project will focus on defining the important of these effects on the regulation of BMP signaling in biologically relevant settings, including the patterning of Xenopus embryos, and the control of mammalian neural precursor cell proliferation. In defining how and when co-receptor mechanisms regulate BMP signaling, we will obtain sights into the mechanisms that ensure the precise orchestration of developmental processes. These insights should aid in the understanding of human development and the prevention of birth defects.